PPP Targets Informal Sector, Offers Path to Retirement Security for Small Businesses, Leadway Pensure

By LOVETH AZODO, Lagos

Nigeria’s vast informal workforce may be on the cusp of a pension transformation as Leadway Pensure PFA Limited positions the Personal Pension Plan (PPP) as a practical solution to long-standing retirement gaps among small business owners.

The pension administrator says the flexible scheme could play a decisive role in reducing old-age poverty by extending structured savings to millions operating outside formal employment.

The push comes against the backdrop of a heavily informal labour market, where data from the National Bureau of Statistics shows that over 90 per cent of Nigeria’s workforce operates beyond employer-backed pension arrangements.

While these micro and small-scale operators drive commerce and economic activity, many remain excluded from retirement security frameworks, leaving them financially vulnerable in later years.

At the same time, Nigeria’s formal pension industry continues to expand, with total assets exceeding ₦27 trillion and membership crossing the 11 million mark, according to industry data.

This growth highlights both the strength of the existing system and the untapped opportunity to broaden inclusion through initiatives such as the PPP, which is specifically designed for self-employed individuals and informal workers.

Despite early traction, participation gaps remain evident. Industry reports indicate that although more than 200,000 Nigerians have registered for the PPP, only a small fraction actively fund their accounts, underscoring challenges around awareness, consistency, and ease of access. Analysts say bridging this gap will be critical to unlocking the full potential of the scheme.

Managing Director and Chief Executive Officer of Leadway Pensure, Olusakin Labeodan, said the flexibility embedded in the PPP aligns with the irregular income patterns of small business owners, enabling contributions that match their financial realities.

He noted that sustained education, simplified onboarding processes, and digital engagement will be key to driving adoption and helping informal sector participants build long-term financial security.